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True cost of ethanol

Hi If you add up the cost of seed, fertilizer, tilling, planting, harvesting, and farm subsidies, what is the true cost of ethanol per gallon compared with gasoline???


  • gagricegagrice San DiegoPosts: 28,850
    The true cost is hidden in the streams and rivers contaminated by over fertilization. First without subsidies there would not be any ethanol. Or very little. When oil is $70 per barrel and ethanol has a 51 cent per gallon subsidy it is a break even per gallon price. That does not take into account that using E85 cuts efficiency by 25-30% in vehicles built to withstand the corrosiveness of ethanol.
  • byronwalterbyronwalter Posts: 220
    And not to mention (although I am) that some estimates suggest that corn-based ethanol uses about 8 or 9 gal of petroleum to make 10 gal of ethanol.

  • kronykrony Posts: 110
    Depends on where you get your data...Ethanol's Net Energy Value:
    A Summary of Major Studies -- Authors and Date NEV (Btu)
    Shapouri (1995) - USDA +20,436 (HHV)
    Lorenz and Morris (1995) Institute for Local Self-Reliance +30,589 (HHV)
    Agri. and Agri-Food, CAN (1999) +29,826 (LHV)
    Wang (1999) – Argonne National Laboratory +22,500 (LHV)
    Pimentel (2001) - Cornell University -33,562 (LHV)
    Shapouri Update (2002) – USDA +21,105 (HHV)
    Kim and Dale (2002) - Michigan St +23,866 to +35,463 (LHV)
    Shapouri (2004) – USDA +30,258 (LHV)
  • gagricegagrice San DiegoPosts: 28,850
    I find it interesting that E85 was about $3 a gallon when gas was that price. Now that gas is $2 per gallon so is E85. Are they taking a loss on E85 to match gasoline? Or were they overcharging to make as much as they could while the market was hot.

    If gas is $2 a gallon, E85 should be $1.40 to break even in a FFV.
  • anthonypanthonyp Posts: 1,857
    IMO ethanol is a poor deal if used as e85, but as an addative to make gasoline burn more cleanly, is worthwhile..If it can over time supplant ten or more percentage of gasoline usage, and cut our dependance on foreign oil then a worthwhile endeavor..The public will quickly learn what a fair price for the product is Tony
  • gagricegagrice San DiegoPosts: 28,850
    Ethanol was the oxygenator of choice until the oil companies sold the government on MTBE. We all know what a fiasco that was/is. If they had not mandated Ethanol for the whole USA. It would not have caused the shortages that helped run the price of gas up. If we have an across the board 2.97% ethanol mix it will be fine. Some places have had E10 for years. They had it in Minnesota when I was living there in the late 1970s. Right now I don't think it is helping the farmers as the Feds would have us believe. It may be giving some communities a boost. What will the long term affect be?
  • gagricegagrice San DiegoPosts: 28,850
    Interesting article from two different farmers:

    The ethanol boom is spreading money around the heartland like so much fertilizer. Billions of dollars in new government subsidies have touched off a flurry of private investment at biofuel operations across the Midwest. Tired towns where opportunity has slipped away for decades now see their salvation in the giant distilleries that turn corn into alcohol for the gas tank. Almost every rural hamlet has a plant in its sights, or so it seems.

    Yet the benefits of ethanol fall unevenly, and some longtime rural interests stand to lose ground even as corn farmers and many others gain.
  • tpetpe Posts: 2,342
    An excerpt from a CNNMoney article.

    McCain said in November 2003. "Yet thanks to agricultural subsidies and ethanol producer subsidies, it is now a very big business - tens of billions of dollars that have enriched a handful of corporate interests - primarily one big corporation, ADM. Ethanol does nothing to reduce fuel consumption, nothing to increase our energy independence, nothing to improve air quality."

    "I support ethanol and I think it is a vital, a vital alternative energy source not only because of our dependency on foreign oil but its greenhouse gas reduction effects," he said in an August speech in Grinnell, Iowa, as reported by the Associated Press.

    I read stuff like this and am simultaneously amused and pissed off. Why do we even waste time voting if we have no clue what these politicians actually stand for? This is a fundamental problem in our system that dwarfs the significance of the ethanol issue. htm?postversion=2006103112
  • gagricegagrice San DiegoPosts: 28,850
    It is a fallacy with our system. The only way to keep politicians honest is to have term limits. In 2003 he could be honest because he was not running for President. Now things have changed. He don't want to lose the Midwest so you pander to each part of the country and hope no one notices.
  • gagricegagrice San DiegoPosts: 28,850
    With corn futures hitting $3.70 per bushel, what will that do to the ethanol market? It was high priced sugar in the 1980s that killed the ethanol market in Brazil.
  • The recently introduced Biofuels Security Act of 2007 proposes a renewable fuels standard of 30 billion gallons per year by 2020 and 60 billion gallons per year by 2030. They must be joking.

    I would write more but I got to go plant a few bushels of corn and soybean in the backyard :shades: And some people thought ethanol was a fad...............
  • gagricegagrice San DiegoPosts: 28,850
    When it starts interfering with my diet I have to protest.

    Mexico is in the grip of the worst tortilla crisis in its modern history. Dramatically rising international corn prices, spurred by demand for the grain-based fuel ethanol, have led to expensive tortillas. That, in turn, has led to lower sales for vendors such as Rosales and angry protests by consumers.

    The uproar is exposing this country's outsize dependence on tortillas in its diet -- especially among the poor -- and testing the acumen of the new president, Felipe Calderón. It is also raising questions about the powerful businesses that dominate the Mexican corn market and are suspected by some lawmakers and regulators of unfair speculation and monopoly practices.

    Tortilla prices have tripled or quadrupled in some parts of Mexico since last summer. On Jan. 18, Calderón announced an agreement with business leaders capping tortilla prices at 78 cents per kilogram, or 2.2 pounds, less than half the highest reported prices. The president's move was a throwback to a previous era when Mexico controlled prices -- the government subsidized tortillas until 1999, at which point cheap corn imports were rising under the NAFTA trade agreement. It was also a surprise given his carefully crafted image as an avowed supporter of free trade.
    ethanol causing starvation
  • texasestexases Posts: 5,511
    Bush's 'we're addicted to oil' has proven true - get rats addicted to drugs, they'll take the drugs instead of eat. Now we're turning our food into gas in a wasteful manner, and people are going to starve (not us of course, so we don't worry about it). Watch for inflation to kick back in over the next year. Corn's in lots of things (about half a hamburger starts out as corn). It's such a waste...
  • wlbrown9wlbrown9 Posts: 835
    Hum...poor folks south of the border suffer now since much of their diet is corn. Beef, pork and chicken feed is a major market for corn in the US. I would rather eat reasonably priced meat and pay a little more for gas.
  • A recent study at MIT shows that ethanol does have a net positive effect on the environment Link to Study
  • Interesting link, thanks.

    The actual conclusion of the study was: "Corn ethanol, while a not achieving significant GHG savings compared to gasoline, can be seen as a stepping stone to ethanol produced from cellulose."

    We just had two ethanol plants go online in my state within the last few months. One plant is getting their energy/steam from the local power plant. That plant is basically using waste heat from the coal plant. The other plant is burning coal which is cheap but not the most emission friendly fuel around.

    The MIT study talks about using natural gas. So it appears they did not count the extra efficiency of the cogeneration process being used in the Blue Flint Plant.
  • gagricegagrice San DiegoPosts: 28,850
    I went ahead and followed the link to MIT and read the whole study. It sounded to me like they had to do some interesting calculation juggling to get corn ethanol in the positive column. The conclusion I drew was they are waiting for someone to develop a good process for cellulose ethanol. That will require all new infrastructure from current corn ethanol plants. Do we just scrap the ones we are building now when the price of cellulose ethanol makes them antiquated? My guess is government involvement in the ethanol business will set it back at least a decade.

    As you have noted these new ethanol plants are coal fired as natural gas ia in short supply in the corn belt.
  • I am not sure what you mean exactly by "set the ethanol business back by 10 years." If you mean they have over-hyped it, I would agree. On Planet Ark they had a story about Spain possibly shutting down an ethanol plant. I've been reading that some potential ethanol plants in the US are being canceled. Lower gasoline prices and higher corn prices have scared off a few get rich quick investors. :cry:

    Talk of 30 billion gallons a year is a bit optimistic. High corn prices will likely limit yearly production to 7 - 10 billion gallons a year. Cellulose and switch grass are promising but lets not bet the farm yet.

    Until they nail down the exact technology for producing ethanol from cellulose, I do not think we can assume there will or won't be a big need for infrastructure change. Many corn based plants will continue to run.

    There appears to be plenty of natural gas here and for now the price is moderate. The price for gas is very unpredictable whereas coal prices are fairly stable.
  • gagricegagrice San DiegoPosts: 28,850
    My understanding is that 90 ethanol plants built during the last ethanol surge are shut down. Were they outdated or was the government money for building new plants?

    If you read through all the EPA documents on ethanol as an additive you will find the EPA recommends against ethanol or any other oxygenate additive. My contention is without all this government corporate welfare there would not be all these corn ethanol plants being built for no good reason. The net benefit in cutting foreign oil is negligible or a possible loss.

    EPA says NO to Ethanol as an additive
  • avalon02whavalon02wh Posts: 726
    The report was from 1999, this was before 9/11 and before the recent oil price increases.

    "The MTBE Blue Ribbon Panel was created by a Charter from the Clean Air Act Advisory Committee to provide independent advice and counsel to the Environmental Protection Agency on policy issues associated with the use of MTBE and other oxygenates in gasoline."

    "Ethanol An effective fuel-blending component, made from domestic grain and potentially from recycled biomass, that provides high octane, carbon monoxide emission benefits, and
    appears to contribute to reduction of the use of aromatics with related toxics and other air quality benefits......"

    There are good reasons for building (some ethanol plants) such as jobs in the Midwest and higher income for farmers.

    "Five years ago, a United States General Accounting Office (USGAO) report showed that ethanol had received $11.6 billion in tax incentives since 1968, while the oil industry had received over $150 billion in tax benefit over the same period."

    In order to grow the ethanol industry we will need give them subsidies. Having said that, I think we should also reduce the subsidies within a few years with a complete phase out in 5 to 10 years.

    I am in favor of producing enough ethanol (corn based) for an E10 mix. When we can get ethanol from algae or cellulose we can see about doing more E85.
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